The case is before us on the motion of Southern and Manhattan for summary judgment against the plaintiff, and the motions of Jasper and Robert DiSanto for summary judgment against Southern and Manhattan on their complaint and third-party complaint, respectively.
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We will reserve decision on the motion of third-party plaintiff Robert DiSanto, as his motion has not been adequately briefed. See n. 3, supra. For the reasons set forth below, we will grant Southern and Manhattan's motion for summary judgment, and deny plaintiff's motion.

(a) If piloted by other than the pilot or pilots designated in the Declarations or endorsed hereon(.)

Under the heading "Pilot Qualification Endorsement," the policy provides as follows:

When in flight the aircraft shall be operated only by the pilot(s) designated below . . . :

Robert DiSanto . . .

Any other pilot, provided he has a Commercial Pilots Certificate with Rotorcraft Rating and has a minimum logged flying time of 500 hours as pilot in command of rotorcraft, of which 50 hours shall have been in same make and model as being flown.

Certain other clauses in the policy are relevant to the plaintiff's contention that the policy is ambiguous and will be discussed in detail when we address that contention.

This policy resulted from negotiations during the month of June 1976, between Susan Trahey of Harlan, Incorporated of Pennsylvania (Harlan), plaintiff's insurance broker, and Jim Harris, an employee of Southern. After requesting and receiving a quote from Southern for a new insurance policy, Trahey sent to Harris on June 22 a telex which read in pertinent part as follows:

The notation "Ded 250/2000" meant that the proposed hull coverage would include $ 250 deductible for damage occurring while the craft was not in motion and $ 2000 deductible for damage while in motion. Harris responded by telex of June 23, saying:

This is to confirm that we have bound all as per your tel June 22.

On June 22, Trahey also completed an "Insurance Order Form" which provided, inter alia, that the desired hull coverage include $ 2000 in-motion deductible. The order form also included the following statement with respect to pilots:

PILOTS: Robert Di Santo and/or any private or better certificated pilot who has a minimum of 300 total logged flying hours in Rotary-Wing Aircraft of which not less than 15 hours shall have been in make and model being flown.

COMPLETED PILOT DATA AND APPLICATION WILL BE FORTHCOMING (capitals and emphasis in original). On June 23, Jasper DiSanto signed his "Aircraft Application," in which he stated that Robert DiSanto had 400 hours of flight experience.

On July 1, Harris transmitted the policy to Trahey, with a cover letter which stated:

Please refer to Endorsement No. 1 (Pilot Qualification Endorsement) and note that we have named Robert DiSanto as an approved pilot and also we have provided you with an open pilot warranty which requires a pilot having a Commercial Pilot Certificate with Rotorcraft Rating and has a minimum logged flying time of 500 hours as pilot in command of rotorcraft of which 50 hours shall have been in same make and model as being flown. This open pilot warranty is different from the one on your binder of June 22nd, so please review this with the Insured in order that we will not have any misunderstanding as respects any pilots that may fly this rotorcraft.

On July 12, Trahey transmitted the policy to the plaintiff, with a cover memorandum which said:

Please note the pilot requirements are different from the ones outlined on our binder. We apologize for this error and hope it hasn't caused you any inconvenience.

On July 20, 1976, Robert DiSanto brought the helicopter to the premises of Lanes Valley Forge Aviation, Inc., in Collegeville, Pennsylvania, for tests because he was concerned about a vibration in the craft. He delivered it to Thomas H. Kilrain, III, an FAA licensed helicopter mechanic and pilot who was an employee of Lanes. Kilrain examined the craft and began a flight test to determine the cause of the vibration. While Kilrain was flying the helicopter at an altitude of approximately 15 feet, the rotor separated from the body of the craft, which crashed. Kilrain did not meet the description of "any other pilot" in the Pilot Qualification Endorsement, since he had less than 200 hours flight experience in helicopters, less than 20 hours flight experience in an Enstrom F28, and held only a private pilot's certificate instead of a commercial pilot's certificate. Kilrain's failure to meet the policy description had no causal connection whatsoever to the accident. Plaintiff promptly notified the insurers of the accident, but on September 20, 1976, Southern informed him through its agents, Peter J. McBreen & Associates, Inc., that coverage was denied. The sole basis for the denial was Kilrain's failure to meet the terms of the Pilot Qualification Endorsement.

In December of 1977, during the pendency of this lawsuit, plaintiff's insurance broker, Harlan, contacted Southern and requested that it return the unearned portion of DiSanto's premium. The policy provides:

25. CANCELLATION. . . . The company shall not be liable for any return premium with respect to an aircraft on which a total loss has been paid.

The plaintiff interprets this provision to require the return of the unearned portion of the premium for DiSanto's policy, since in his view the aircraft was a total loss but the insurers paid nothing. Bill Brokaw of Southern replied to Harlan's request by telex of December 5, 1977:

I have checked and find that this loass (sic) is currently being litigated. Any return premium will have to wait pending the final outcome of the case. I will keep a suspense and compute any return due as soon as possible.

In November 1979, however, Southern tendered to plaintiff the amount of the unearned premium.
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Plaintiff refused to accept that tender.

It is plain from the June 22 telex itself, from contemporaneous and subsequent actions of plaintiff's agent Susan Trahey, and from insurance practice, that the June 22 and 23 exchange of telexes was intended by the parties to do no more than to create a "binder," obligating the defendants to undertake insurance coverage beginning from the date of the binder, i. e., June 22, upon policy terms to be fixed in detail shortly thereafter. The June telexes clearly were not intended to state all the terms of the insurance contract, a document which in its final form is ten pages long.

This conclusion follows first from the fact that the June telexes on their face contemplate further dealings between the parties before the final terms of the policy are fixed. Trahey's telex states, "Will transmit our binder and request completed application from insured." Ms. Trahey used the term "binder" here apparently to refer to the Insurance Order Form which was submitted to the defendants. The term is also used in insurance practice to refer to a document memorializing a temporary contract of insurance pending action by the insurer on an application. See p. 1358, infra (quoting R. Keeton). We have used the term, in accordance with that usage, to refer to the exchange of telexes on June 22 and 23, which similarly expressed a temporary insurance contract. What is important here is that, by its terms, Trahey's contractual offer on behalf of the plaintiff expressly promised the further submission of documents. Harris' confirming telex of June 23 bound the defendants only "as per your tel," i. e. within the terms of Trahey's telex, including the submission of further documentation.

On the same day that she sent the telex, June 22, Trahey submitted an "Insurance Order Form." This document proposed a pilot qualification term of the contemplated policy.
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Since the pilot qualifications were one of the terms of the policy which had not been specified in the agreement by telex, Trahey's transmittal of the Insurance Order Form was a request to supply one of the uncompleted terms of the policy. The Order Form, submitted by plaintiff's agent, again expressly contemplates the submission of still more documentation since it notes that "Completed pilot data and application will be forthcoming." Plaintiff's application was in fact signed on June 23 and submitted to the defendants.

It often happens that there is a substantial interval between the time a policy of insurance is applied for and the time it is issued. . . .

To meet some of the needs during this interval pending action of the insurer on an application, a practice has arisen of making a temporary contract of insurance by a written memorandum of vital terms, other terms of the agreement being ascertainable by reference to sources such as policy forms, rate schedules, and customary practices. . . . With respect to (casualty insurance), these memoranda are often issued in advance of payment of any premium and are usually called "binders."

R. Keeton, Basic Text on Insurance Law 36-37 (1971). See also 12 J. Appleman, Insurance Law and Practice § 7221 et seq. (1943 & Supp.1979). In the case before us, the exchange of telexes was the functional equivalent of the customary memoranda. As has been noted, the final policy may be lengthy, containing limitations, conditions, and exclusions which cannot be stated in a telex message (or a short memorandum).

Since the parties left open the pilot qualification term in their original exchange of telexes, there was no need for independent consideration in the form of a reduction or increase of premium for the term subsequently supplied. The June 22 and 23 telexes plainly contemplated that details of the insurance policy which was ultimately issued would be supplied later, in conformity with insurance practice and custom. Accordingly, plaintiff's argument that the pilot endorsement contained in the policy was a modification of the insurance contract reached by the parties in their telex exchange, and that it is void because it was adopted by the defendants unilaterally and without consideration, must fail.

If doubt exists as to the meaning of the language used in an insurance policy, that language is to be interpreted favorably to the insured. Nevertheless, where the language of the policy is clear and unambiguous, it cannot be construed to mean otherwise than what it says. It must be given the plain and ordinary meaning of the terms used.

The policy here in question is clear and unambiguous, and the meaning of the language used is already beyond reasonable question.

Plaintiff claims to find two ambiguities in the policy. First, he notes that the pilot exclusion, paragraph 2(a) under the heading "Exclusions," is not specifically made applicable to Coverage F, the policy coverage which is relevant here. Some other exclusions are listed under the sub-heading "Under Coverages F, G, H and I (Hull)," but none of the exclusions under that sub-heading deal with pilot qualifications. Plaintiff contends that the insurers' failure to include the pilot exclusion under a sub-heading which specifically references Coverage F renders the policy ambiguous. However, the pilot exclusion is stated under the sub-heading "This policy does not apply and no coverage is afforded," see p. -- , supra (quoting exclusion). This language is utterly unambiguous and makes it absolutely clear that the exclusions stated thereunder apply with respect to all coverages afforded by the policy.

The second purported ambiguity upon which plaintiff relies is even more strained than the first. Noting that the pilot exclusion denies coverage to an "insured," see id., plaintiff consults the definition of the word "insured" in the "Definitions" section of the policy. That definition provides in (arguably) pertinent part:

The unqualified term "insured" wherever used in this policy with respect to Coverages A, B, C and D shall include not only the Named Insured, but also any person while using or riding in the aircraft and any person or organization legally responsible for its use, provided the actual use is with the expressed permission of the named insured.

Plaintiff contends that because the policy explicitly defines the word "insured" only with respect to Coverages A, B, C and D, the pilot exclusion, which uses the word "insured," is limited in its scope to those coverages, and is not applicable to Coverage F. While the unconvincing nature of that strained construction should be apparent without further comment, we note (1) the quoted definition enlarges the meaning of the word "insured" with respect to coverages A, B, C, and D, and clearly implies that, except as enlarged, "insured" means "Named Insured" with respect to all other coverages; (2) on the first page of the policy under the heading "Declarations," the plaintiff's name appears over the caption "Name of Insured;" and (3) the word "insured" has a clear "plain and ordinary meaning," Turner, supra, which is unaltered by the definition except with respect to coverages A, B, C, and D. We conclude that the policy is wholly unambiguous.

Pfeiffer v. Grocers Mutual Insurance Co., 251 Pa.Super. 1, 379 A.2d 118 (1977). Accord, Fedas v. Insurance Company of the State of Pennsylvania, 300 Pa. 555, 151 A. 285 (1930). Plaintiff argues that he has been prejudiced by the defendants' retention of the unearned premium and by their failure to pay $ 50,000 for the loss of his helicopter in the July 20, 1976, accident.

Plaintiff misunderstands or misstates the nature of the prejudice which is an essential element of the doctrine of estoppel. To demonstrate the requisite prejudice, plaintiff must show that he acted or refrained from acting in reliance on some conduct of the defendants. For instance, in Central Market Street, supra, the insurer accepted premiums with knowledge that the insured had failed to comply with one of the conditions of the policy. If the insurer had refused to accept the premiums, or had refused to continue the policy in effect while the breach continued, the insured could have remedied the breach or found another insurer. Instead, the insurer by its inaction induced the insured to remain in noncompliance with a condition of the policy. Thus the insured in that case was prejudiced and, the other elements of estoppel being present, the insurer was estopped from denying coverage. Without the element of reliance on some conduct of the party sought to be estopped, the prejudice which is an essential element of estoppel cannot be proved. Sabino v. Junio, 441 Pa. 222, 272 A.2d 508 (1971); ACF Produce, Inc. v. Chubb/Pacific Indemnity Group, 451 F. Supp. 1095, 1100 n. 2 (E.D.Pa.1978) (Huyett, J.); see also Commonwealth v. Transamerica Insurance Co., 462 Pa. 268, 341 A.2d 74 (1975) (law of waiver).

Here, the plaintiff could not have relied on the retention of the premium in any material respect. The defendants' denial of coverage was based solely on the failure of the pilot of the aircraft at the time of the accident to meet the terms of the pilot qualification endorsement in the policy. The retention of the premium occurred only after the time of the accident. Obviously, by that time the plaintiff was powerless to alter the identity of the pilot of the craft. Moreover, the defendants could not have had knowledge of the non-compliance prior to the accident, since that non-compliance only began immediately before the accident when Kilrain began to fly the craft. The mere fact that the defendants retained an unearned premium is not sufficient to create an estoppel against them. We note too, in this regard, that the reason which defendants initially gave for retaining the premium was the pendency of this litigation, see p. 1356, supra, in which their liability to pay for the loss is in dispute. That is not an unreasonable position.
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Finally, by pointing to the defendants' failure to pay him for the loss of the helicopter as a form of prejudice, plaintiff in essence makes the argument that the insurers are estopped from denying coverage of the accident because they denied coverage of the accident. This argument is lacking in merit because it is circular.

In Collister, the appellant's husband had applied for life insurance and paid a two-month premium in the amount of $ 60.66. In exchange for that payment, the insurance company's agent gave the husband a "conditional receipt," which stated plainly in bold letters that the insurance would not be effective until the applicant had completed a satisfactory medical examination. See 388 A.2d at 1356 (reproducing text of receipt). In addition, the company's agent told the applicant that a medical examination was required; however, the record did not establish that the agent told the applicant orally that coverage would not begin until successful completion of the medical examination. Id. 388 A.2d at 1354-55; cf. id. 388 A.2d at 1357 (dissenting opinion). The applicant did not obtain a medical examination before his death, but his wife, the appellant before the Court, argued that the insurer's acceptance of his application and premium created a temporary insurance contract notwithstanding the language on the conditional receipt.

The Court viewed the transaction between the appellant's husband and the insurer's agent as a contract of adhesion. Id. 388 A.2d at 1350-51. It commented:

Because the insurer is in the business of writing insurance agreements, the recent trend in insurance cases has been away from strict contractual approaches towards a view that insurance policies (and other insurance contracts) are no longer private contracts in the traditional sense (if they ever were). The traditional contractual approach fails to consider the true nature of the relationship between the insurer and its insureds. Only through the recognition that insurance contracts are not freely negotiated agreements entered into by parties of equal status; only by acknowledging that the conditions of an insurance contract are for the most part dictated by the insurance companies and that the insured cannot "bargain" over anything more than the monetary amount of coverage purchased, does our analysis approach the realities of an insurance transaction. See Brakeman v. Potomac Ins. Co., 472 Pa. 66, 371 A.2d 193 (1977).

Id. 388 A.2d at 1353. The Court held:

The reasonable expectation of the insured is the focal point of the insurance transaction involved here. . . . Courts should be concerned with assuring that the insurance purchasing public's reasonable expectations are fulfilled. Thus, regardless of the ambiguity, or lack thereof, inherent in a given set of insurance documents (whether they be applications, conditional receipts, riders, policies, or whatever), the public has a right to expect that they will receive something of comparable value in return for the premium paid.

Id. (citation omitted). In order to determine the nature of the reasonable expectations of the insured, the Court examined "the dynamics of the transaction viewed in its entirety:"

Appellee also contends that their agent informed appellant's husband that a medical examination was necessary. Appellee has not established by clear and convincing evidence, however, that their agent told the decedent that he was paying money upon application for insurance coverage that would not begin until successful completion of the medical examination. The fact that he informed appellant's husband that a medical examination was required by the insurer does not affect our conclusion therefore.

Id. 388 A.2d at 1354-55. Thus the Court found that the insurer had failed to meet its burden of proving that the applicant did not have a reasonable expectation of coverage because, inter alia, the company's agent never informed him that he would not be covered and the printed receipt was not an appropriate medium by which the company could inform an average consumer of limitations on coverage.

In the case before us, plaintiff admits, as he must, that the contract was not one of adhesion.
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In Brokers Title, supra, the Third Circuit has analyzed the meaning of the term "contract of adhesion" in the context of insurance contracts, applying Pennsylvania law. 610 F.2d at 1179-80. The plaintiff in Brokers Title, a title insurance company, sought to hold the defendant liable under an "errors and omissions" insurance policy. The defendant refused to pay because, as the district court found, the policy unambiguously excluded coverage for the plaintiff's claim. However, the district court held that the unambiguous exclusionary clause did not apply, following the "reasonable expectations rule" of Pennsylvania law. 466 F. Supp. 1174, 1178 (E.D.Pa.1979). The court found that the defendant's agent had read the exclusion to the plaintiff's president, but had not explained its effect, and that the plaintiff's president misunderstood the effect of the exclusion, although he had never communicated that misunderstanding to the defendant.

The Third Circuit reversed, finding the exclusionary clause fully applicable because the insurance policy was not a contract of adhesion. As the court of appeals noted, "an adhesion contract has been described as "one which is dictated by a predominant party to cover transactions with many people rather than with an individual, and which resembles an ultimatum or law rather than a mutually negotiated contract.' " 610 F.2d at 1179 (footnote omitted).

The parties in Brokers Title were of relatively equal bargaining power; indeed, the insured there was itself in the business of selling insurance, albeit in an entirely different speciality. The court of appeals explained:

In the present case, the pertinent language defining the qualifications of pilots, other than Robert DiSanto, for whom coverage is afforded, is a typewritten addition to the insurance policy. Thus it is not "dictated by a predominant party to cover transactions with many people rather than with an individual." Cf. Brokers Title, supra. The plaintiff negotiated the policy by means of his agent, an experienced insurance broker. While plaintiff suggests that Brokers Title has no application beyond contracts between two insurance companies, we do not believe that the decision can be read so narrowly. Just as in Brokers Title, the plaintiff here was specifically informed of the pilot endorsement, but failed to make any objection. As in Brokers Title, there is no hint in the record that the insurer would not have issued a policy with more liberal pilot qualification standards, or at least negotiated the point in exchange for an adjustment of the premium, if the insured had made his objection known. Finally, as in Brokers Title, the policy actually issued served a reasonable business purpose since it insured against risks of loss whenever the craft was flown by qualified pilots, except insofar as other terms of the policy provided otherwise. Thus it was not unconscionable or contrary to public policy. Presumably, too, the exclusion of coverage when the aircraft was operated by pilots without the requisite experience was reflected in a lower premium.

Since the present action is on all fours with Brokers Title, the "reasonable expectations rule" of Collister, which arose in the context of a contract of adhesion, is inapplicable. We note, however, that even if Brokers Title were not controlling, the reasoning of Collister would not apply here in any event: (1) because the plaintiff was specifically notified of the pertinent term of the policy prior to the accident, and in time to protect his interests had he desired to do so;
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and (2) because the factual bases for alleged "reasonable expectations" do not measure up to those in Collister.
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We conclude that the reasonable expectations rule is inapplicable in this action, and that even if it were applicable it would not preclude the defendants from denying coverage in these circumstances.

5. Causation of the Accident

Plaintiff contends that under Pennsylvania law, the insurer may not deny coverage unless the excluded risk is causally connected to the loss. As we have noted, the defendants concede that Kilrain's failure to meet the terms of the pilot qualification endorsement had no causal relationship with the accident which occurred while he was piloting the craft.

The only Pennsylvania authority cited by plaintiff to support his position is dictum in Weissman v. Prashker, 405 Pa. 226, 175 A.2d 63 (1961). In that decision, which like the case before us involved the loss of an aircraft, the Court held that an exclusion in the insurance policy did not cover conduct in which the pilot was engaged at the time of the crash. After stating that holding, the Court went on to comment that, in any event, the "proximate cause" of the accident was "a maneuver on the part of the pilot which fell entirely outside the scope of the exclusionary provisions." 175 A.2d at 68.

The liability of the insurer under the terms of the contract depended upon the insured's compliance with certain conditions relating to matters material to the acceptance of the risk by the insurer. In the circumstances the fact that there may have been no causal relation between the violation and the loss is wholly without bearing on the question of whether plaintiff breached the conditions.

181 A.2d at 300. Similarly, in this case the terms of the policy do not require a causal link between the pilot qualifications and the accident in order to render the exclusion applicable.
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Therefore, under Blue Ridge Textile, no such causal link is necessary.

We conclude that the absence of a causal link between the pilot qualification term of the insurance policy and the accident of July 20, 1976, does not affect the applicability of the pilot exclusion. Since we have now rejected each of plaintiff's legal arguments, plaintiff's motion for summary judgment will be denied. We turn to defendants' motion.

B. Defendants' Motion for Summary Judgment

The defendants' motion for summary judgment is grounded on the plain language of the policy, which is quoted in pertinent part at p. 1356, supra. We agree that the plain language of the policy requires judgment in favor of the defendants. None of the arguments which the plaintiff has advanced to avoid this result is persuasive, and we have considered and rejected each of those arguments in turn.

While this result may appear harsh, since it is mere circumstance that the accident occurred while the craft was piloted by a licensed mechanic who did not meet the terms of the policy, we agree with Judge Troutman who, in denying insurance coverage to a plaintiff who had been permanently injured in a motorcycle accident, said:

Considering Taylor's serious and permanent condition and the cost of treatment and rehabilitation, natural feelings and instincts dictate that every effort be made to ease his burdens. But public policy does not so dictate. Rather, public policy dictates that legitimate and unambiguous contracts entered into without fraud, duress, coercion or improper conduct shall be fairly interpreted and enforced.

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